US considers implementing 3Mt cement import quota, abolishing tariff

The US Department of Commerce (DOC) intends to set up a 3Mt import quota for Mexican cement in place of the 55% anti-dumping tariff currently charged, Mexico City daily Reforma reported.

Talks over reducing the restrictions on US imports of Mexican cement have been held on and off for over a decade, but the Mexican producer’s argument has been boosted by the devastation caused by hurricanes in the US, especially Katrina and Rita in Louisiana.

Given that reconstruction works in the southern US will require large amounts of materials and there is high demand for cement, construction firms are pressing the authorities to act to allow more imports, according to Stephen Sander, director general of Associated General Contractors of America.

"We are not exporting because of the high levy charged in the US, but if it disappears, then of course we are going to sell our product in that market," Holcim Apasco spokesman Gustavo Gastelum was quoted as saying.

Grupo Cementos de Chihuahua CEO Manual Milán Reyes said he expected that the import tariff of US$32.85/t charged in the US would be abolished at the start of 2006.

"It is not just Mexican companies fighting to eliminate the tariffs, but there is also pressure from the Americans themselves because of the deficit after the hurricanes passed through the region, so we expect it [the tariff] to be abolished," the executive was quoted as saying.

The abolition of import tariffs on Mexican cement would be good news for Cemex and would provide a boost to its share price, said Santander-Serfin brokerage analyst Gonzalo Fernández.

World Trade Organization anti-dumping regulations stipulate that such levies should expire after five years, but the US has maintained the tariffs for over a decade despite threats of litigation from Mexican authorities.